COMPETITION POLICY AND ECONOMIC GROWTH: INVESTIGATING THE RELATIONSHIP BETWEEN MARKET CONCENTRATION AND EXPORTS FOR THE GCC REGION

Abstract

This paper aims to study the relationship between competition policy and economic growth. Competition policy is generally defined as a tool that contributes to the decentralization of economic decision-making, promotes small businesses, and prevents the abuse of economic power. In this paper, I will be using the Herfindahl-Hirschman Index (HHI), a measure of market concentration as a proxy for competition policy, and oil and non-oil exports (%GDP) as proxies for Economic Growth. My study will focus on the GCC countries (Saudi Arabia, Bahrain, Oman, Kuwait, Qatar, and UAE), where I will investigate this impact through a panel OLS and 2SLS regression, with the intensity of local competition used as an instrumental variable over a period of 13 years. This paper will consist of 5 sections, the first section will consist of the introduction, which will present an overview of competition policy and economic conditions for the GCC and present a literature review. The second section will focus on the conceptual framework for the GCC. The third section I will be discussing the Empirical strategies used in this paper. Section 4 will highlight the results and output. Finally, section 5, will conclude and present policy recommendations.